“Following up on comments made last week, recent research still leads us to believe that Apple may be planning to add another form factor to its iPad line in the 7″ range for the fall,” the note read.

According to their report the new mini iPads would be useful in promoting Apple’s education agenda and could also help the company’s gaming efforts. Barclay’s also said: “The lower priced iPad [is] a necessary entry point to make the tablet market the size of the PC market by 2015 in terms of units (over 350 million units) – a figure CEO Tim Cook repeatedly mentions.”

Apple’s new tablets will be in direct compeition with Amazon’s kindle. They are expected to be priced between $249 and $299.

“Essentially, the iPad Mini is going to be a shrunken version of the iPad 2, but with the same pixel dimensions as the new iPad. This means that the Mini will actually have the same pixel density of the iPhone 4S’s retina display.”